Cancelled affiliate commissions – my recent experience

By | February 24, 2015

One of the sites I own is a Dutch website that reviews specific sports shoes. I’m doing affiliate marketing with the site, and get most of my sales from a Dutch webshop (that I’m not going to name). I’m actually doing pretty well with it; I get a CTR of between 30-50%, and around 3-5% conversion rate.

Up until last month, I had 0 returns or cancellations for my affiliate commissions. The website has been steadily selling products for over the last three months. Guess I got lucky until then. For the last few weeks, I’ve had about half of my commissions rejected because of returns. I highly suspect it’s because of sizing issues.

The real problem is this: the webshop offers a 5 day cookie, but allows customers to return the product for up to 14 days after delivery. Delivery for the items I promote is between 2 and 3 business days. This by itself, could mean that my cookie is expired by the time the item arrives. The customer then has to try it out, and decide to keep it or not. By that time, my 5-day cookie is expired for sure.

Customers that return the product for incorrect sizing, will then proceed to order the order it in the correct size. Now, the webshop has made their sale, but I don’t have the commission, even though it was my website that brought the customer in, and helped convincing the customer to make the purchase.

Is there a solution to this problem?

Only sign up for programs with a longer cookie duration?

In my case, this isn’t a possibility. Some of the products are just not available anywhere else.

Also, this is not a complete solution. Even if the cookie duration is longer, it’s possible the customer has cleared their cookies in the meantime, or used a different computer, or their smartphone, when reordering the product in the correct size.

A better solution would be for the affiliate program to have another system in place to track sales than just a cookie, or have the webstores automatically grant commissions to the original referrer when an item is swapped. I don’t know about any affiliate programs that do this currently. There are a few programs that pay you a bonus for every new customer, which means you’d still get the bonus if the item is returned, which is nice. However, this is nothing you can really change as an affiliate publisher.

Make sure you offer the best possible information on the product

This will improve the changes of having the expectations of the customer met. This one is pretty obvious, and I expect that most affiliates will do their best to do this. When it comes to sizing, however, this is really difficult. There are just too many variables. The size is usually only expressed with one or two numbers, that just don’t give all information about how it fits, on a real, 3D person.

When researching how something fits, I nearly aways find hugely conflicting information. Half of the people might say it’s too large, the other half might say it’s too small. I recently researched a pair of shoes that I own myself, which are half a size too large for me when compared to my other shoes, and the sizing chart from the company thats sells them. Most people on the internet complain they’re too small or too tight. Now, what advice should I put on my website? This will continue to be a problem.

However, I’d still recommend doing your research well. I have found some products on which most people agree about the sizing, so I go with that. Also, leave comments on your website open and ask the buyers for their opinion on the product.

Go for a completely different niche

Go for a niche with a lower return rate / higher confirmation rate. The clothing, shoe, and fashion niche is notorious for a high amount of returned products. For some evidence, using the affiliate network Zanox, you can see that Zalando, a large e-commerce company for anything you can wear, only has about 65% confirmation rate:

Zalando-Confirmation-rate2

This means that nearly 35% of the sales you make as an affiliate, won’t earn you a commission. When researching this subject, I found that even experienced affiliates in the clothing and fashion niche still see between a third and a quarter of their commissions rejected.

My next niche affiliate website is going to center around large, heavy products, with pretty high shipping costs. Because of that, I don’t expect many returns for those items at all, so this won’t be a problem.

Take advantage of the situation

Now, for instance, Zalando makes it really easy for the customer to return product, and offers free returns. You’ll lose some of your commissions because of that, but you can also use this to your advantage! Clearly state the fact they offer FREE RETURNS on your site to increase CTR and conversions by taking away doubt in the customer. Obviously, the return policy is going to be different for each webstore, but at least do some research.

Take the returns for granted

Just accept the fact you’re going to see cancelled commissions, and lots of them. Try to find the confirmation rate beforehand, if available, and take it into consideration when estimating your affiliate earnings, so you won’t be disappointed when they happen.

Anything else?

It’s possible there are more, or better solutions to this problem. So, have you ever had a problem similar to this? And what did you do to handle it?

5 thoughts on “Cancelled affiliate commissions – my recent experience

  1. Sarah

    Wow, I had not thought about this issue. It really doesn’t seem fair that the company has such a short cookie lifespan. Is it a possibility to speak with the company and use your leverage from the amount of sales you are doing? Just an idea. I will keep this in mind when I sign up for programs, which I am just now starting to do. Thanks for the info. Sarah

    Reply
  2. Ty Jord

    It’s the finer details like these that you have to look out for. I guess we need to understand that these companies set things up in such a way that they ultimately will not lose.

    Sorry to hear you’ve had such an experience, and all seemed to be going so well.

    My best to you.
    Ty

    Reply
    1. GuidoGuido Post author

      I don’t necessarily feel scammed by these companies, but it’s definitely a flaw in the system. A longer cookie time wouldn’t be a loss for them either; their margins are large enough to make every extra sale gained through affiliate marketing very profitable for themselves.

      Amazon for instance only uses a 1-day cookie, so I guess this will be an even bigger problem. I’ll find out soon enough, as I’m busy on rolling out a site that’s going to use their affiliate program.

      Reply
  3. John

    Ty,
    When working in any online business, returns are a bitter pill to swallow. It is like the brick and mortar store I work at and returns are around 15 % daily. Cancelled affiliate commissions will be just another part of business when working out your business plan. Thanks for bringing this to light for others.
    John

    Reply
    1. GuidoGuido Post author

      John, normal returns would be completely fine with me. I don’t think this is what’s happening though. The products I’m promoting are high quality, and usually only get 4-5 star reviews. Also, they’re expensive enough to not be an impulse buy that you might regret later. It must be people returning the item, just to order the correct size afterwards.
      The fact that the webstore is still profiting from me referring the customer to them, without me getting my commission for that, is what bugs me.
      I’ll definitely keep this in the back of my mind though, and not take any sale I make for granted. Also, I will be on the lookout for confirmation rates more before signing up with an affiliate program.

      Reply

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